Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review
of Undistributable Child Support Collections in Orange County, California, From
October 1, 1998, Through March 31, 2006," (A-09-06-00040)

April 4, 2008

Complete
Text of Report is available in PDF format (651 kb). Copies can also be obtained by
contacting the Office of Public Affairs at 202-619-1343.

EXECUTIVE SUMMARY:

For the period October 1, 1998, through March 31, 2006,
California did not recognize or report program income totaling $2.2 million
($1.5 million Federal share) for Orange County’s undistributable child support
collections and interest earned on child support collections. Undistributable
collections result when a State receives a child support payment but cannot
identify or locate the custodial parent or return the funds to the noncustodial
parent. States are required to offset Child Support Enforcement program costs,
for which they receive Federal matching funds, by recognizing and reporting
undistributable collections and interest earned on collections as program
income. The deficiencies occurred primarily because California had not
sufficiently monitored the county’s unclaimed collections and because the county
had focused its resources on processing current child support collections.

We recommended that the State (1) monitor the county’s progress in resolving the
status of unclaimed child support collections and report as program income those
collections recognized as abandoned, (2) report program income for
undistributable collections that the county agency already recognized as
abandoned, and (3) report program income for interest earned on child support
collections. The State concurred with the findings
and described how it was addressing the recommendations.